Types of Home Insurance Policies
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Types Of Home Insurance Policies
Purchasing home insurance is just as important as the purchase of the home. Because buying a home is such a major financial investment, it is essential to make sure that your home, property, and contents are protected. There are various types of home insurance policies available so it is imperative to understand each type so you can make an informed decision.
HO-1 is the most basic type of coverage available. It insures against fire and lightening damage.
HO-2 is usually referred to as broad coverage. Coverage includes damage from such events as smoke, wind, rain, hail, vandalism, theft, an explosion, removal of items that are threatened by fire damage, glass breakage, and damage cause by falling objects. As well, it also covers snow causing a roof collapse, ice damage, burst pipes, water damage from broken pipes, and damage from a riot.
HO-3 is sometimes called all risk insurance and insures your home against damage or loss. There are exclusions that will be listed in the policy so you should read what items are excluded. This is the most commonly purchased home insurance policy.
HO-8 is referred to as the 'older home' policy. If you have an older home, some policies may not provide replacement coverage. You may have to purchase a modified replacement policy where the policy will reimburse you for standard building materials.
There are many other types of policies, but these are the most common and one of them will likely fit your needs.